On May 17, 2019, President Trump signed a Proclamation Adjusting Imports of Automobiles and Automobile Parts Into the United States under Section 232 the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862). The Proclamation states that the Secretary of Commerce’s (the Secretary) Section 232 report on his investigation into the effects of imports of passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks (collectively “automobiles”) and certain automobile parts (engines and engine parts, transmissions and powertrain parts, and electrical components) on the national security of the United States found that:
- automotive research and development (R&D) is critical to national security.
- increases in imports of automobiles and automobile parts, combined with other circumstances, have over the past three decades given foreign-owned producers a competitive advantage over American-owned producers and “[d]efense purchases alone are not sufficient to support . . . R&D in key automotive technologies”
- automobiles and certain automobile parts are being imported into the United States in such quantities and under such circumstances as to threaten to impair the national security of the United States
The Proclamation states that the President concurs with the Secretary’s finding and that domestic conditions of competition must be improved by reducing imports. Furthermore, the President states that American-owned producers must be able to increase R&D expenditures to ensure technological leadership that can meet national defense requirements. Successful negotiations could allow American-owned automobile producers to achieve long-term economic viability and increase R&D spending to develop cutting-edge technologies that are critical to the defense industry.
Accordingly the Proclamation states:
(1) The Trade Representative, in consultation with the Secretary, the Secretary of the Treasury, and any other senior executive branch officials the Trade Representative deems appropriate, shall pursue negotiation of agreements contemplated in 19 U.S.C. 1862(c)(3)(A)(i) to address the threatened impairment of the national security with respect to imported automobiles and certain automobile parts from the European Union, Japan, and any other country the Trade Representative deems appropriate.
(2) Within 180 days of the date of this proclamation, the Trade Representative shall update me on the outcome of the negotiations directed under clause (1) of this proclamation.
(3) The Secretary shall continue to monitor imports of automobiles and certain automobile parts and shall, from time to time, in consultation with any senior executive branch officials the Secretary deems appropriate, review the status of such imports with respect to the national security. The Secretary shall inform the President of any circumstances that in the Secretary’s opinion might indicate the need for further action by the President under section 232 of the Trade Expansion Act of 1962, as amended.
(4) Any provision of previous proclamations and Executive Orders that is inconsistent with the actions taken in this proclamation is superseded to the extent of such inconsistency.
